How does the "Chinese-style liquidity injection" work? The funding logic from the central bank to the finance sector [Master Class with Master Xiong 3.4]

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Many investors often ask: Has the central bank “printed money”?

If you compare the United States and Japan, you’ll notice a clear difference — their central banks can directly implement QE and purchase assets; whereas China’s policy system often requires a more indirect approach.

For example, instead of directly buying assets, the central bank uses the China Securities Finance Corporation; funds are not directly injected but are gradually transmitted through re-lending, special bonds, and policy tools.

It may seem complicated, but behind it is a very clear logic:

Why does China’s “money printing” lean more towards fiscal channels? Why do local government bonds, consumer subsidies, and industrial funds become key policy tools? And why, starting from 2024, does the policy clearly signal a new trend — the country is more willing to leverage?

Understanding this “Chinese-style liquidity injection” approach is essentially understanding the flow of policy funds in the coming years.

And the flow of funds often determines the market’s structural opportunities.

Let’s understand this flow of funds from the central bank to fiscal policy. Click here or the image below to unlock the full content.

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